Health Policy, Politics, and Perspectives

Governor Baker, Secretary Sudders Testify on Administration’s Comprehensive Health Care Legislation

Governor Baker: Chair Friedman and Chair [inaudible 00:00:04] and members of the committee, thanks for turning out today and thanks for this opportunity to provide testimony in support of an act to improve health care by investing in value.

The legislation that we filed is preparing our healthcare system and to address present current issues and face the future. The legislation is about investing in value with the goal of improving outcomes for patients, increasing access to care and bringing down costs. Overall, as a state, we have seen modest success in slowing the rate of cost growth. Commercial spending growth in Massachusetts has been below the national rate every year, since 2013. However, for many residents, the cost of health insurance coverage continues to increase. Massachusetts has the third highest average family premiums, and it has among the highest employer sponsored insurance premiums in the US. 23% of Massachusetts middle class families spend more than a quarter of all earnings on healthcare.

People are getting screens to both ends, with no apparent relief in sight. The situation we're confronting has been decades in the making, it's complicated and there's no silver bullet to solve it. The legislation we've proposed includes big, not marginal, reforms in five key areas. Prioritizing investments in primary care and behavioral health, improving access to high quality coordinated care, supporting community health care providers, including community hospitals and community health centers, managing healthcare costs and increasing affordability and promoting insurance market reforms.

For the past 50 years, the US health care system has been focused, primarily promoting and supporting the technological advancement of medicine. That focus has cure disease, enhanced therapies and save lives. But even as that progress has continued, our healthcare system has failed to appreciate the changing nature of illness and the systemic gaps in care delivery that have been created by this approach. We've seen that across the nation and here in Massachusetts with the opioid epidemic. A system that financially incentivizes writing a prescription over supportive and sustained therapy yielded an addiction epidemic of gargantuan proportions.

For far too long, we've neglected preventative services that keep people out of our emergency rooms. Services like primary behavioral health care and investments in addiction care and supports for older adults. We can no longer afford to ignore this. The nature of illness has changed. Chronic illnesses are far more prevalent than they used to be. And some of us, anyway, are living longer. For a variety of reasons, addiction and behavioral health issues are far more challenging than they were in the past. And we increasingly recognize how they are intertwined with physical illnesses. We continue to have a primary care shortage that was identified, literally decades ago. This was all unsustainable.

Simply put, our healthcare system is not designed to serve our changing patient population for their healthcare needs. Changing the system requires more than increasing rates. We must proactively prioritize and incentivize services that prevent people from getting sick in the first place. We must invest in team-based approaches to treat the whole individual and intervene earlier. Our system should be [inaudible 00:03:27] healthcare organizations that invest in a comprehensive set of physical and behavioral health systems. Something that our current system does not.

This proposal is designed most fundamentally to flip the script. The legislation is designed to create financial incentives for healthcare providers and [inaudible 00:03:44] to reprioritize their service delivery and payment decisions. It promotes system wide investments in primary care and behavioral health services that are undervalued in today's payment models and delivery system. Massachusetts has had significant success in attaining near universal insurance coverage for residents of the commonwealth. And has started to see modest success in controlling overall cost growth. We should be proud of that success, but there was much more to do.

Patients and their families continue to face barriers to accessing necessary care, while individual consumers and employers are burdened by growing premiums and out-of-pocket costs that consistently outpace the rate of inflation. We believe this bill builds on the strengths of our current system and pass legislative reforms, while addressing those and which we still fall short. While some proposals in this legislation are new, there are also familiar proposals in areas that we believe represent common ground. Including, surprise billing, facility fees, prescription drug spending, including the regulation of pharmacy benefit managers, scope of practice, particularly advanced practiced nursing. Damn Telemedicine, urgent care centers, supporting our community hospitals and community health centers and achieving parody. Some people say it's really hard to get DS in this space and I get that, but we're experiencing unprecedented challenges. We have a number of issues that there's been general agreement on for quite a while. And I believe we should be able to find common ground and get something done during this session.

With respect to prioritizing investments in primary care behavioral health care we believe this is fundamental to the success of this system going forward. Particularly, with respect to early identification and treatment. Today, less than 15% of total medical expenditures in Massachusetts are spent on primary care and outpatient behavioral health services combined. This needs to change. The legislation establishes spending targets for primary and behavioral health care requiring payers and providers to increase their spending on these services by 30% over the next three years are within the parameters of the states' overall healthcare benchmark. Performance against the proposed spending targets will be measured and payers and providers will be held accountable through a framework that was established under chapter 224, The Commonwealth's cost containment law.

Provider and payer entities that don't achieve the target will be [inaudible 00:06:28] to the health policy commission and if determined, appropriate subject to performance improvement plans. Recognizing healthcare provider systems and pairs at varying baselines, the legislation doesn't prescribe how systems must achieve this target. Performance against the target will be measured off the total medical expenditures of plan members and attributed patients for patients ... Excuse me. Payers and providers, respectively.

We think using TME as a proxy for investment is the right way to go. And we expect that payers and providers will be able to meet those targets through modifications to bare price and utilization. Employing strategies, such as for providers increasing access to primary care behavioral health services through expanding practice hours and or site locations. Modifying referral practices in a way that supports primary care and behavioral health clinicians spending more time with the patient rather than a prompt referral to a specialist. Reallocating, and this one's important, negotiated rate increases in favor of primary care behavioral health services for line clinicians.

And for payers, targeted [inaudible 00:07:37] increases to our primary care behavioral health service lines and clinician [inaudible 00:07:41] and modifying utilization management criteria and standards to promote time and therapy over transactional activities. What does this mean for payers and providers? Payers, and providers will need to reprioritize the dollars in the system and care delivery strategies in favor of primary care and behavioral health services. To achieve retirement within the state's cost growth benchmark, [inaudible 00:08:05] holding other service lines flat financially, or in some cases to bring growth.

The legislation also proposes reforms to increase access to high quality coordinated care, not only for behavioral health care, but for other services for which we know barriers and gaps in treatment exist. For example, we want all of our practitioners to rank at the top of their license. Currently, we're one of the 12 most restrictive states for nurse practitioners and licensed psychiatric nurses. Having nurses practice at the top of their license will increase access particularly, but not exclusively for primary care and behavioral health.

And this, by the way, is not a new idea. In fact, I worked on this 27 years ago. 27 years ago. Probably testified in this room, when I was still in the secretary setters chair as secretary of health and human services. And with that, I will turn it over to the secretary. I think you were here to Madam secretary.

Secretary Sudders: I was a kid. Morning, members of the committee. Since I'm older than he is. Not possibly true. I will not read my testimony. We very much appreciate the opening statements of the chairs. I'm going to briefly touch upon behavioral health, improving access, supporting our community health care providers, managing costs, consumer protections and insurance reforms in three minutes or less.

On behavioral health. I've spent my entire career in the behavioral health space, both personally and professionally. I think we can all agree that reforms are necessary and a long time coming. Currently, approximately half of all licensed behavioral health clinicians in our great state do not accept any insurance. The legislation proposes reforms to both encourage practitioners to accept insurance and remove other administrative barriers that are necessary to accessing behavioral health services. To address the administrative burdens associated with insurance contracting we propose requiring all insurers, including mass health, to use a standardized credentialing application. Right now, practitioners are required to fill out multiple applications and if you're a single or small practice, it can be overwhelming.

We address rate inequities for behavioral health providers by having the division of insurance, establish a rate floor for certain services based on the reimbursement rates for comparable services delivered by non behavioral health medical providers. And let me give you an example. DOI would establish that rates floor, for example, office visits. If you had an office visit for your primary care physician and an office visit for your psychiatrist, we would expect that those be on par and, no, to achieve parody, it does not mean that the higher rate comes down, but the lower rate comes up.

The lack of behavioral health practitioners, accepting insurance results in patients having to seek treatment from providers that are not in their insurance networks or paying privately resulting in much higher out of pocket costs for our consumers. This happens far more often for behavioral health services than it does on physical health. In fact, it's only exceeded by plastic surgery. Behavioral health is second after plastic surgery in terms of people having to pay privately or feeling like they need to pay privately. To address this we require payers to report to DOI when members are getting care from an out of network provider. Because we all know how important network adequacy is for reviews and determinations.

We will also require insurers to reimburse, and this is important as a social worker, to reimburse non-licensed behavioral health professionals in training who are working under the license of another practitioner on their way to becoming licensed. Just as medical residents are reimbursed for services rendered while they're still in training. Further signaling that behavioral health treatment is just as important as physical health. Currently only the Medicaid program is the payer that reimburses for individuals in training under the practice of a licensed clinician. Anyone who's struggled with behavioral health knows this isn't just about access, it's about timely access and it's about affordability.

A common thing that happens to families if they see a therapist and someone who's prescribing their medications in the same day, you can only bill for one of the services. The other service is rejected and the family has to pay out of pocket. Again, that's one of the barriers we're looking to eliminate. And as you know, on the physical health care side, if you saw your primary care physician and then had a radiology appointment, both of those would be paid. There are often some of these nuances and insurance that we need to deal

We also know that behavioral health often goes hand in hand with substance use. In 11 of our hospital emergency departments throughout the commonwealth and individual struggling with both substance use and a behavioral health condition may be paired up with a recovery coach. And we know how important that is. But every recovery coach's training may be different. And since there's no agreed upon standard it's not accepted by commercial insurance. Based off of recommendations from the legislatively creative Recovery Coach Commission, we propose the establishment of a state board of registration, of recovery coaches to credential and standardized the positions to promote insurance reimbursement.

Let me touch briefly upon high quality coordinated care. It's only 179 pages. The governor and I decided we wouldn't need all 179 pages to you this morning. He mentioned how nurse practitioners will be able to practice at the top of their license. Long overdue. The legislation also authorizes Massachusetts to join the Nurse Licensure Compact. Currently, we're one of less than 20 states that's not joined the multi-state Nurse Licensure Compact, that allows nurses to work across state lines.

We propose once again, a mid-level dental provider position to provide basic dental services and expand access. We establish a clear definition for tele-health. Astonishingly, Massachusetts was the innovator of telehealth, and we're one of the last states to really embrace. It and requires insurers to cover certain tele-health services, if the same service is covered in person. And we define and license urgent care services. Requires that they must accept mass health members, provide some level of behavioral health services and meet certain standards related to primary care.

To echo something that Vice Chair [inaudible 00:15:07] mentioned, our community healthcare providers. The bill recognizes the critical role that community hospitals and community health centers play in our healthcare system. In recognition of that vital role, we deposited $15 million into the Health Safety Trust fund the same day we filed this legislation. The legislation proposes additional funding for certain community hospitals and health centers through a redesigned community hospital and health center investment trust fund. With a specific focus on community hospitals and healthcare centers that are struggling financially. Ongoing funding is derived from the existing [inaudible 00:15:47] transfer and revenues generated from our proposed drug manufacturer penalty.

Consumer protections. Because really, it's all about us, the consumers. Our legislation addresses rising healthcare costs across the system, including important consumer protections to ensure patients are not left with extraordinary out-of-pocket costs. As you know, this year together with your support, we took bold action to control drug costs in the Mass Health program. And it's effective. So far, we have successfully completed negotiations with five manufacturers on 11 drugs, resulting in $10 million net saving. That's just through January 14th.

There are five key elements to the drug pricing cost containment proposals before you. One. And when we're talk about drugs, people assume it's homogeneous, but there's not. For drugs that have been in the market we impose fines on any drug that increases year over year above inflation plus 2%. many people have talked about the inflationary costs of like insulin or EpiPens. This would address that. For new drugs to market we'll bring them into the health policy commission for drug pricing accountability.

We update the original provisions of chapter 224 to include members of the pharmaceutical industry in the health policy cost annual cost trend hearings. That's a mouthful. And to ensure that when you, as a consumer go to the pharmacy to pick up your prescription, that you were paying the lowest price for that drug. Sometimes the retail price is actually less than what your copay is. We want to ensure that consumers pay the lowest price offered. And we propose, as many other states have, that we regulate the middlemen known as pharmacy benefit managers or PBMs.

Too often, we hear about stories of surprise medical bills, which happen after someone goes to the emergency room and is treated by an out of network provider without their knowledge. That's why our legislation we propose prohibits surprise billing, and creates a process for establishing an out of network default rate. A policy that wants your providers are adequately compensated for services rendered and reduce unnecessary costs associated with payment disputes. Similarly, our legislation addresses facility fees. Which are another source of unexpected costs to consumers.

Finally, we need to make health insurance more affordable. Wherever you travel individuals, families, employers large and small, are talking about the costs. Rising premiums and out-of-pocket costs are crowding out income gains and straining economic growth. Massachusetts has the lowest uninsured rate in the country. That's important. I'm proud to tell you, at the end of the open enrollment at the connector, just closed with more than 318,000 people signing up for health insurance. But a stable and affordable health insurance market is key to maintaining our near universal coverage access. Small employers are the backbone of our economy. We propose providing our small employers with more affordable coverage options for their businesses and employees. The legislation will ensure that high value, affordable plans such as those designed to steer patients to low cost, high quality providers are easily accessible.

In addition, as you know, the governor signed an executive order creating a merge market commission, and we expect to have the findings available to the legislature by the end of April, in order to help further inform your work. Many of our reforms we have proposed will help reduce costs, while maintaining our high quality, that we expect, and delivering a more cost-effective, nimble and patient-centric healthcare system. Shifts like the ones we propose represent change, especially with this size and scale creates discomfort. We understand that. But the question we leave with you today is will these shifts enable our healthcare system to modernize and better address changing needs, prepare Massachusetts for their future, deliver greater value to our consumers, to us? The governor and I believe the answer is yes. Thank you for having us this morning.